Goldman Sachs Bombshell

Yea, what a bomb-shell. I thought they were doing g-d's work

He must have not gotten his promotion.
In today's world, it's all about production. That's how our culture shaped out to be and it will continue to be that way. Sanity in insanity makes you the odd one out.

That article was funny. All these talk about his ping-pong championship, scholarship looks self promotional. Talking about his appearance on promotional video showed how naive he was. It was probably more of a choice to show the company's diversity (did he say he came from South Africa)for recruiting purposes than his real performance at work. Labeling himself as an executive, thus know it all was also misleading. As it is widely known now, an executive director title in Europe is the equivalent of VP in US. This subtle difference is very important in seeing through his potential motive.

If he is really not a high ranking executive, like a MD or PMD, in the company, his departure could be a result of denial of promotion or big bonus. Since he regarded himself so highly with his great qualifications, a good chance of a real disgruntled FORMER employee would do.

Goldman was doing righteous work until about 2 years ago so that why he quit now. Everything changed for the worse only relatively recently. Nothing to do with a promotion. Please disperse.

Someone told me once that you have to have a "rabbi" to be successful at Goldman.

This was explained as meaning someone who would protect you from internal politics, and also someone who would ensure that you got the full bonus that was coming to you. Or "someone who makes sure you get paid."

So my first thought when I read this op-ed was maybe this guy didn't have a rabbi, or maybe the one he had abandoned him.

But the bottom line is, Goldman is a terrifically political place to work, or so I hear.

As for the comments here, I agree with Riversider (for maybe the first time ever ;-) How can you go to work at Goldman and expect to be doing noble work?

Since he competed in the Jewish olympics it is quite likely he has a Rabbi. Just not the kind you are talking about.

Also, if he is originally South African it would explain his success to date even though his accomplishments make him seem at best good, not great (Rhodes finalist, bronze medal, ED). Americans are suckers for foreign accents, particularly British and S. African (SA British accents, not as much Afrikaans).

Probably a bright enough guy, but he is being quite torn apart on industry websites.

" he is being quite torn apart on industry websites."

Problem for Goldman is he put it in the mainstream media, not an industry website. I am looking forward to GS's spokesman now trying to tell the gen public that Executive Director don't mean sh*t and that they have thousands of them, which begs the question of why you give nobodies such exalted titles in the first place. Perhaps to mislead people?

"How can you go to work at Goldman and expect to be doing noble work?"

Believe it or not, that wasn't always the case.

front running..
----------
Goldman Sachs told some investors who bid on the bonds through the bank that, while they had offered the best prices on individual securities, the firm had bought the debt for itself, according to three money managers with knowledge of the matter. Goldman Sachs then offered the securities for sale to the investors, they said. The prices were between 1 and 3 cents on the dollar higher, said one of the people, who declined to be identified because the transactions aren’t public.

http://dealbreaker.com/2012/02/goldman-sachs-stopped-by-to-pick-up-some-things-aig-was-holding-on-to-for-it/

So why adding the jewish thing into this Graffiti? When the ship goes down let's blame the jews? Sounds familiar..

And by the way this is the true line ‘Make for yourself a rabbi, acquire for yourself a friend and judge every person favourably’ You are really off with your interpretation and kind of ignorant as well.

And by the way, The guy, naive or not, I am sure he is right.

I am looking forward to GS's spokesman now trying to tell the gen public that Executive Director don't mean sh*t and that they have thousands of them, which begs the question of why you give nobodies such exalted titles in the first place. Perhaps to mislead people?

This is so funny. GS is an American company and "executive director" is a rank used only in non US regions. Logically, that translate to a title that foreigners would understand. In the US, that rank is called Vice President. Anyone here do not know what a Vice President is in a financial firm? What issue of misleading would that be? If you think a VP should have the authority just below the president of the company, then you are kidding yourself.

switel
I think your way off on the wrong road with GG.
It is a common slang term the way GG describes in political centric arenas. I don't know how or where it got it's start and though likely in the beginning it had some anti-semetic flavor about it is not really meant as such.

If you watched HBOs "The Wire," you would have heard the term often and used exactly as GG described. I think it was the political season, season 5.

switel - Graffiti didn't bring in the Jewish thing. He brought up that the guy may not have had, or had lost, a Rabbi. "Rabbi" is a term at many organizations, including particularly non-jewish ones (like the NYPD) for someone who fulfills the role of a mentor. Someone who acts as protector and advisor. Someone whose teachings you follow.

And as to the guy being right, of course he is about the fact taht GOldman is a bunch of money-grubbers who care mostly, if not totally, about the $. The argument on the web is; Was he right that it wasn't always this way or naive/ignorant that it was and that he finally wised up. Also that he wasn't particularly a n "executive" in that practically everyone at a bank is an "executive".

Well, um, that's great that everyone who deals with Goldman knows what a VP is. But he was an Executive Director and if you think that title has not gained him some additional standing with both his "foreigner" clients, as well as the media and the general public, than you are kidding yourself. I am merely pointing out the irony of title inflation coming back to kick them in the ass.

E.g, the USA today does not seem to have bothered to figure out the difference between Executive Director and Executive:

http://content.usatoday.com/communities/ondeadline/post/2012/03/goldman-executive-resigns-blasts-firms-toxic-environment/1#.T2Dq1xGvJ8E

go figure.

I know the term, I use it as well but it in the right way and not as a slang, it should not be turned into a joke. it's kind of offensive. The fact that everybody use it as a joke, that doesn't make it right.

And as Thruthskr10 said: " don't know how or where it got it's start and though likely in the beginning it had some anti-semetic flavor....." it's enough for me for not liking it.

malthus,

The title of executive director is a concept that foreigner can grab better. You as an american felt like GS was trying to mislead using that title, but people in a foreign country would think a title of VP is more misleading. That was why the title of executive director was used instead.

Don't get me wrong, a VP or executive director is still a very respectful title by all means. However, once you know their true meaning, you don't call them an executive automatically. It is the press who wrote that should go back and do more homework before publishing.

Oy Veh.....were you offended for Al Yeganeh as well?
Soup Nazi was pretty rough.

Jesus....Lighten up....or should I say Yeshua?

The Rabbi comment was not off-base.

How about a prayer to Bernadine of Feltre, the patron saint of bankers

http://saints.sqpn.com/patrons-of-bankers/

yes im not making it up

Thruth, you don't see the problem do you?? You guys are creating a correlation between jewish term and a specific organization that everyone hates. Sometimes it all it takes.

short memory, very short memory.

whah?!

the rabbi as business mentor and protector exists in excellent firms as well as bad ones, jewish christian--sensitivity of this sort is counterproductive

next

Switel
AVuws' comment > "Since he competed in the Jewish olympics it is quite likely he has a Rabbi. Just not the kind you are talking about." ....pretty much removed the negative correlation.

Your the one making the correlation ten times worse.

Your like someone who had a glass of wine at a bar mitzvah and got pulled over by a cop 4 hours later but so paranoid about it stumbles out of the car and slurs his speech.

Chill, switel.
I'm here to defend the tribe if it comes to that.

Anyway I think its pretty accepted that bankers (of all faiths) are pretty greedy.
Why is that still the story?
Isnt this particular bank greasing our president the bigger story?
Just pretend it's a white republican president to see past the partyline prejudice.

Go turn your lights off truthskr; you energy-waster, you.

Truthy, you know I would, only it keeps those centipedes from prematurely running around.
I don't want to kill them off as I see no other bug, ever,as they are quite handy as 24 hour exterminators.
I just prefer they do it without me watching tv in the dark and giving me a heart attack.

How would anyone other than insiders know the culture of a firm as large as G and know that that culture extended beyond the confines of their own working group. How would you know the culture of other firms in order to make a comparison or to even know there's a difference. You go to work, you do the job you strive to meet your goals you collect your bonus you live to work another day. That's how you work for the man.

switel: In GG's context, Rabbi is interchangeable with Guru. It is not offensive usage -- not to the jews, not to the hindis.

Rabbis are advisors.
If it was remotely offensive , I'd be on board.

Back to Goldman.
Does Blankfein eventually get the boot?

If he were, I think Blankfein would feel nothing but relief.

The boot based on some VP in a foreign office who didn't get promoted?

I think I already saw this movie. It was called Jerry Maguire. He also tried to change corporate culture.

He's complaining, not whistleblowing. He didn't cite any specific wrong. Just a culture, even though he stayed with that culture for many years. Why didn't he quit in 2008?

Not a bombshell. Just some whiny gen-y'er who is butt-hurt over not making Managing Director, or didn't get the bonus he wanted, etc. You know where the door is, kid - use it. No need to email everyone in the company about it on your way out.

The meaning of rabbi here was not used to replace mentor but as "someone who made sure you get paid" this is what bothering me.

Mayo and I met yesterday in his modest office, and he had this to say: “The country is in a crisis of confidence, and Greg’s article and the global reaction to it, are a reflection of that. It’s not an isolated event – I’ve witnessed it for 20 years”.

Banks’ habit of putting their own short-term interests ahead of their client’s financial well being didn’t begin with the market meltdown in mortgages in 2008, and it isn’t just Goldman.

“I lived it firsthand,” he said, “and my book is an account from 20 years ago. Greg also lived it firsthand at Goldman, and how much his unique insight will affect the 35,000 remaining Goldman employees will be debated for years”.

Mayo’s book recounts his personal experience as an analyst at six firms (including some that fired him). The notion that financial services companies pursued short-term profits at the expense of shareholders’ long-term benefit was a common theme in his writing.

And it wasn’t just the banks: auditors, rating agencies, regulators and other Wall Street analysts – who had incentives to give favorable research opinions on the companies they covered – were also guilty.

“It is still hard for an analyst to be both objective and critical, and it takes more work to do the job right than it does to be a bullish or conflicted analyst”, Mayo writes.

So how would he change the financial sector? “Michael Douglas can’t kill off Gordon Gekko”, Mayo said, referring to the SEC’s advertising campaign to bring integrity back into the marketplace.

“We need to put the proper incentives in place. There’s a great quote from the Torah, ‘don’t put a stumbling block before the blind’. If we allow employees to make enormous fees while investors suffer, both that behavior and those who created the improper incentives to do so should share equally in the punishment.”

The path to restoring integrity in financial services begins with simple steps, which he calls the ABCs – Accounting, Bankruptcy and Clout.

Start with the accounting – get the numbers right, and make companies rotate their auditors every few years. Fat fees beget complacency. And few auditors want to risk annual fees in excess of $100 million to point out serious errors. Remember Arthur Anderson and Enron? “The 10-K should be signed by the auditor, just like accountants have to sign a tax return they prepare”.

Next, allow bankruptcies. No bank should be too big to fail – shareholders would be supportive of smaller entities that would allow them to stabilize some portion of their investment. He likes a baseball analogy: “Take them out of the big leagues, send them to the minors until they clean up their act.”

Finally, give shareholders some of the clout currently resting with the CEO and the board. It’s no secret that boards involve a lot of cronyism, and it’s hard for a board member to speak out against his pal who put him there. But if shareholders had some say in key areas like the composition of the board, compensation and strategy, companies would be forced to behave.

How does he feel about his children growing up and going to work on Wall Street? “I hope my kids will provide value to the world. My wife is a doctor, my son loves math and science – maybe he will come up with a cure for a disease. If my kids choose financial services, and are able to allocate scarce resources more efficiently, what could be better?” he said.

“I don’t want the bad practices of the few to dilute the perception of collective contribution”.

http://ftalphaville.ft.com/blog/2012/03/15/925871/mayo-on-greg-smith-and-the-abcs-of-change/

This was in my mailbox this morning. It was sent by an employee who was trying to solicit business from me and failed. Feel free to comment on the company attempts in PR by all level of employees. it is the first time that the guy did not attached his official title. (I wonder why).Note that he is on first name with "Lloyd"..

Hello,

Thank you for those who have proactively reached out with supportive remarks. Your comments are greatly appreciated. Below I’ve attached Goldman’s official response to yesterday's Op-Ed piece. I found Lloyd’s comments to accurately reflect my experience at the firm. Having read the Op-Ed piece, I can tell you first-hand that it does not reflect GS Culture or what I’ve experienced during my career at the firm. My family (my wife and soon-to-arrive daughter) have made significant personal and professional sacrifices to allow me to work at Goldman Sachs, and if my experiences were similar to that of what Greg Smith described then, simply put, I would leave.

As always, I’m happy to chat and given this week's event, I’m happy to provide client references for those interested in hearing a Goldman client's perspective.

Be well and good luck to those participating in March Madness festivities.

PS. It’s great to see the S&P top 1400 again.

"Start with the accounting ... make companies rotate their auditors every few years. Fat fees beget complacency."

- poor idea. It takes several years to get your hands around today's largest corporations. Rotations less than 10 yrs means, just when the auditor figures the place out, he needs to leave and a new, inexperienced auditor takes over.

“The 10-K should be signed by the auditor, just like accountants have to sign a tax return they prepare”.

- Uh, the auditors DO sign an audit opinion in every 10-K, where they tell you that they agree, disagree, or cannot reach an opinion on the financial statements. P.s. - Auditors don't "prepare" a 10-K the way a tax practitioner prepares a tax return. Auditors AUDIT a 10-K that was prepared by someone else.

Wow, where did you learn so much Al_caonima?

"Start with the accounting ... make companies rotate their auditors every few years. Fat fees beget complacency."

I think companies nowadays DO rotate their auditors much more often than they used to. I know we have, and most of peers have too.

"Uh, the auditors DO sign an audit opinion in every 10-K, "

Right, and sometimes they say in the 10-k that they disagree with X- or Y-. Companies can say whatever they want, literally, but their investors and possibly the SEC will come down on them potentially, or least examine very closely, if they auditors say they are not comfortable with X, or worse, that Y seems inaccurate.

Jason - those are good points. Most audit committees of boards rotate their auditors every so often, because they see it as a way to demonstrate good corporate governance (and therefore minimize the chance of a shareholder suit).

http://www.youtube.com/watch?v=oPOmbEpIO7c&feature=player_embedded#!

Goldman v Bloomberg:

http://money.cnn.com/2013/05/10/news/companies/bloomberg-goldman-sachs/?source=cnn_bin
Goldman catches Bloomberg reporters spying on terminal users
By James O'Toole @jtotoole May 10, 2013: 5:19 PM ET
NEW YORK (CNNMoney)

Big Bloomberg is watching you.

That was the unsettling realization Goldman Sachs (GS, Fortune 500) executives came to a few weeks ago when a Bloomberg reporter inadvertently revealed the surveillance capabilities reporters from the news and financial data provider have over users of Bloomberg terminals.

Traders throughout the financial world depend on Bloomberg terminals for real-time data on markets of all kinds as well as news and instant messaging. The machines reportedly rent for $20,000 a year and are used by thousands of subscribers, bringing in a substantial portion of the company's revenue.

In a recent conversation with a Goldman executive, a Bloomberg reporter mentioned that a partner at the bank hadn't logged into his terminal recently. This prompted concern from Goldman that Bloomberg journalists could be tracking users on the terminals, a bank spokesman said.

The news was reported earlier by the New York Post.

Related: AP hack proves Twitter has a security problem

Bloomberg spokesman Ty Trippet said the company had quickly addressed Goldman's concerns.

"Limited customer relationship data has long been available to our journalists, and has never included clients' security-level data, position data, trading data or messages," he said in an email.

Journalists also couldn't see what news stories users read and what securities they viewed, though they could access details on when users had logged into their terminals, when they became subscribers and what sorts of functions they were using.

"In light of [Goldman's] concern as well as a general heightened sensitivity to data access, we decided to disable journalist access to this customer relationship information for all clients," Trippet said.

In a memo to Bloomberg employees Friday afternoon, CEO Dan Doctoroff called the newsroom's access to customer data "a mistake."

"Client trust is our highest priority and the cornerstone of our business, and we are deeply committed to ensuring the complete integrity and confidentiality of our clients' data in all situations and at all times," Doctoroff wrote.

Goldman said its business relationship with Bloomberg, founded by New York City Mayor Michael Bloomberg, was unaffected by the issue.

And if you visit Bloomberg offices, they photograph you and keep the data for quite a number of years. I couldn't believe I was still in their system when I hadn't been at their HQ for ~5 years!